New FWO probe as Woolworths underpayments soar $144m

The supermarket giant has a revealed a staggering leap in employee underpayments, and apologised to staff.

Woolworths CEO Brad Banducci. Picture: John Feder

The Fair Work Ombudsman will investigate Woolworths after the supermarket giant revealed underpayments to employees had jumped to $571m, the highest amount declared by a single employer during the recent years of wage theft scandals.

Woolworths Group chief executive Brad Banducci apologised to staff after the company disclosed a further $144m in underpayments following a review started last year into the pay and conditions of employees covered by enterprise agreements.

A separate review into thousands of staff paid annualised salaries - mostly department man­agers - has uncovered under­payments of $427m.

The total underpayment bill will increase as the probe into employees covered by enterprise agreements has so far reviewed the entitlements of 85 per cent of workers, who include checkout operators and delicatessen and floor staff.

The FWO took court action against Woolworths in 2021, alleging the amounts underpaid to store managers on annualised salaries was higher than claimed by the company.

A FWO spokeswoman on Wednesday said the workplace regulator would be launching a new investigation after Woolworths disclosed it was reviewing pay and entitlements issues that were separate from those covered by the legal action. “We expect employers that identify non-compliance to fully co-operate with our investigations to ensure employees are quickly repaid outstanding entitlements,” she said.

In a statement to the Australian Stock Exchange, Woolworths said its “end-to-end payroll review” had uncovered underpayments of Woolworths and Big W supermarket employees. Mr Banducci unreservedly apologised to employees.